LOUISVILLE, Kentucky — Rand Paul was talking with University of Louisville medical students when one of them tossed him a softball. "The majority of med students here today have a comprehensive exam tomorrow. I'm just wondering if you have any last-minute advice."

"Actually, I do," said the ophthalmologist-turned-senator, who stays sharp (and keeps his license) by doing pro bono eye surgeries during congressional breaks. "I never, ever cheated. I don't condone cheating. But I would sometimes spread misinformation. This is a great tactic. Misinformation can be very important."

He went on to describe studying for a pathology test with friends in the library. "We spread the rumor that we knew what was on the test and it was definitely going to be all about the liver," he said. "We tried to trick all of our competing students into over-studying for the liver" and not studying much else.

"So, that's my advice," he concluded. "Misinformation works."

Paul's little riff had the students laughing hard. And it was amusing—but also amazing. Why would he set himself up with an anecdote like that? He knew reporters were in the lecture hall. He's also well aware that watchdogs are compiling a growing file of evidence that he plays loose with the facts. He had offered a few examples to the students that very afternoon.

"Under Obamacare and the current evolution of things, we have 18,000 diagnostic codes. We're going to 144,000 diagnostic codes," Paul told them. It wasn't the first time he had implied that the number of codes—complete with seemingly absurd categories for injuries from macaws, lampposts, and burning water skis—was exploding as a result of the Affordable Care Act. But fact-checkers across the spectrum, from the conservative website The Blaze to USA Today to the liberal site ThinkProgress, had thoroughly debunked that notion months earlier. As Paul must know, the new diagnostic codes were approved by the Bush Administration and have nothing to do with Obamacare.

The students laughed about the macaws and again when Paul said someone making $30,000 a year would not be able to afford insurance under the new law "if it's going to cover pregnancy to sex change to lap dancer." The administration has said plainly that policies do not have to cover sex-change surgery. As for lap dancing, well, that apparently was Paul's imagination going somewhere unusual.

Those few minutes on stage encapsulated the promise and the peril of a brash and politically talented party crasher already deep into preparations for a 2016 presidential race. Paul's positions—a combination of conservative, libertarian, and idiosyncratic—have the potential to excite and enlarge the Republican Party. His informal, engaging personality could attract the young voters Republicans need to survive. Indeed, he could grow into a Reaganesque game changer for his party—if he does not end up a victim of his own affinity for misinformation.

The Promise
This son of former Representative Ron Paul has inherited, or at least appropriated, his father's ability to seduce unconventional and alienated voters. Part of that is due to his policy positions, which are attractive because they sound easy to accomplish. ("Detroit has 50,000 feral dogs, thousands of abandoned houses, and I can guaran-damn-tee you, people in Detroit don't want to send any more money to Egypt.") Part of it is his style, which is casual and in the moment. ("So when I was in college … I never drank any beer or smoked any pot. Oh, actually, no, no, that's Mike Lee's story! I'm stealing Mike Lee's story!")

The overall performance is entertaining and highly relatable, and there are some policy underpinnings to go with it. Paul wins with college kids by supporting states' right to legalize marijuana and gay marriage. He wins with black voters by opposing mandatory drug sentences and promoting charter schools. And he wins with women by ignoring Pentagon brass to support better protections for rape victims in the military.

But it's on foreign policy and national security that Paul could transform the GOP. His battles to curb military forays and foreign aid, and his drive to restrict U.S. surveillance, reach a broad, diverse cross-section of angry, wary, and worried Americans. The Kentucky senator's old-fashioned, 13-hour filibuster—forcing the Obama Administration to say it wouldn't use drones to kill U.S. citizens on U.S. soil—cemented his position in the national political-celebrity spotlight. Starting that night with his #StandWithRand hashtag on Twitter, he rode a wave of public anger all the way to his high-profile opposition to involvement in Syria, declaring there was "no clear national security connection" to the United States.

Perhaps most important for Republicans judging Paul's 2016 viability and his potential to turn enthusiastic fans at rallies into GOP votes at the polls is this: At a time when Americans despise the notion of more foreign entanglements, he has somehow made President Obama and his Democrats look like interventionist hawks. "The thing that could transform our country and transform the youth vote and transform a lot of votes would be if, all of a sudden, the Democrats become the party of war. I think they really essentially are now," Paul said in an interview. Young people "fight all the wars," he said, and might look to the GOP "if there were a Republican Party that were more reluctant to go to war."

This is not to say Paul is a perfect candidate in the eyes of young, minority, and female Americans—far from it. He is firmly opposed to abortion and has introduced a bill giving fertilized eggs the same rights as people. He backs drilling for oil in the Arctic National Wildlife Refuge. And he has an exceedingly cramped view of what the government should be doing. A proposal he released this year to balance the budget in five years would eliminate the Commerce, Education, Energy, and Housing and Urban Development departments; turn Medicaid and food stamps into block grants; add private options to Medicare and Social Security; and repeal the Affordable Care Act.

That minimalist theory of government would be a hard sell even to voters who tell pollsters they think government is doing too much. Asked if there's anything the government should mandate, for example, Paul said, "The government should prevent violence .… They should enforce contracts. They should prevent fraud. But I don't think the government ought to mandate behavior outside of violence."

What does that mean in practice? Nothing that would appeal to liberals or even moderates, as Paul is aware. He told the medical students, "There's a philosophic debate which often gets me in trouble," then waded into it anyway, saying he doesn't believe health care is a right. "I think we as physicians have an obligation, as Christians we have an obligation, to our fellow man. I really believe that, and it's a deeply held belief," he said. "But I don't think you have a right to my labor. You don't have a right to anybody else's labor. I mean, food's pretty important. Do you have a right to food, water? As humans, yes, we have an obligation to give people water, to give people food, to give people health care. But it's not a right."

It's a classic libertarian view, delivered by a short, unassuming guy in khakis and scuffed boots. And, by all appearances, it's an honest reflection of what he believes in and would pursue if he were in the White House. If he were commander in chief, sworn to protect the nation, he said, he'd be willing to live by the restrictions he wants to impose on other presidents. "It's everything that I stand for," Paul said with a disarming straightforwardness that is as much a part of his presentation as his jokes.

It's also as much a part of his allure (especially to young people) as his positions. While Paul has made a point not to alienate the political establishment—unlike colleagues such as Senator Ted Cruz of Texas—his readiness to push the limits, and to engage in sharp exchanges with other senators and Republicans, makes him appealing to the seemingly growing number of people who would classify themselves as antiestablishment. "He's not the pinstripe and patriotic-pin type of candidate," says Stephen Voss, a political scientist at the University of Kentucky. "He brings a freshness to national politics in a host of ways. And he's hitting at the right time. The Republican Party is troubled. They've had a lot of failures. He's offering a new vision."

The Peril
But then, there are the half-truths, cherry-picked factoids, and outright errors that Paul seems steadfastly unwilling to relinquish.

Take health care. Although he's a doctor, Paul repeatedly misrepresents aspects of the Affordable Care Act. For example, all of those crazy-sounding new billing codes he implies are the spawn of Obamacare were in fact released by the World Health Organization 20 years ago and, as The Blaze reported, approved by the Bush Administration in 2008, scheduled for 2011, delayed until 2013, and then delayed again until late 2014, so they'll finally take effect the same year as most of the ACA.

In discussing the expenses the law will impose on consumers, Paul rarely mentions the subsidies many people will receive, and he sometimes says a single person making $30,000 a year will have to pay $15,000 a year in premiums. The government is going to require somebody to pay 50 percent of their income for health insurance? "It depends on circumstances," Paul replies. "I can't tell you where the cutoff is for single without kids. But I think there will be people who are single without kids who don't get subsidies who will struggle to pay $15,000 for insurance." PolitiFactlabeled that assertion "especially off the mark." Citing available facts, PolitiFactsaid such a person would pay at most about $3,000 and could pay far less due to the law's caps, subsidies, and bare-bones coverage options.

The Louisville med students were worried and curious about Obamacare, which could greatly affect their future. "I will continue to fight to make it less bad, at the very least," Paul told them. It sounded like he wanted to fix or improve the law. Later, away from those students, asked how he would improve the law, he told National Journal he would try to delay and defund as much of it as possible in hopes of eventually getting rid of it entirely, because "the whole thing is rotten."

"I can't quote Eisenhower because they say I don't embrace everything about Eisenhower. I can't say I like Eisenhower. Next thing will be: I can't like Lincoln. Can I like part of Lincoln?"

Paul's logic in justifying the GOP drive to kill Obamacare is dicey, too. He says that while the president won reelection by "a small majority" in 2012, "a majority of the people believe Republicans should be in charge of the House" and therefore don't want something like the law that was passed solely by Democrats. Obama won last year by nearly 5 million votes. Some people might consider that a small majority. But while Republicans won a majority of House districts, it's not accurate to say a "majority of the people" wanted a GOP House. Democrats won the House popular vote by more than 1.7 million votes nationwide, the Federal Election Commission reported in July.

On another front, Paul routinely exaggerates the size of the annual federal deficit, pegging it at $1 trillion. In fact, the deficit for fiscal 2013 fell to an estimated $642 billion, heading toward $378 billion in two years, according to a Congressional Budget Office report in May.

Paul's misstatements led to a testy exchange with the local press here before the Kentucky Farm Bureau's ham breakfast in August. "Is the deficit going up or down?" a reporter demanded to know, apparently testing whether Paul would fudge or correctly differentiate between the annual deficit (falling) and the cumulative national debt (rising). And the reporter almost got him. "The def—the debt," Paul corrected himself, "is still continuing to expand." As for the deficit, "we used to be alarmed when it was where it is now," he said. "So it's hard to argue that we're in a good place." Still, Paul has persisted with his misleading talking point. He mentioned borrowing "a trillion dollars a year" on NBC's Meet the Press on October 6—six days after the fiscal year ended and nearly six months after the CBO report.

When asked about the fodder he has provided for fact-checkers, Paul erupted with scorn. "The fact-checking is not fact-checking. These are people with a bias. It's purely an opinion. The stuff is so ludicrous I don't even read it," he said, slapping the table as he spoke. He is particularly put out by Glenn Kessler of The Washington Post, who has given him numerous "Pinocchios" this year for, among other things, tweeting that "neocons" want to keep sending aid to Egypt (several prominent neocons want to cut it off); for misleading statements about foreign aid as a proportion of the federal budget; for asking questions about the Boston bomber case that were based on misinformation; and for citing Dwight Eisenhower as an inspiration for his own skepticism about intervention and foreign aid ("Rand has it totally backwards," Kessler wrote). Kessler cited historians on Eisenhower's views, but Paul doesn't buy it. "I can't quote Eisenhower because they say I don't embrace everything about Eisenhower," he said incredulously. "I can't say I like Eisenhower. Next thing will be: I can't like Lincoln. Can I like part of Lincoln?"

Paul's outsized reaction to the scrutiny raises another issue that would be troublesome for a presidential contender: When he is annoyed, he acts annoyed. He considers some episodes closed, for instance, and often cuts off reporters who raise them. Asked about an aide he was forced to let go because of the aide's history of inflammatory statements about race, Paul became exasperated. "I'm sort of done with that," he replied. "If you've got one more question … "

National candidates always face repeated questions about subjects they'd rather avoid. Some of them get confrontational in response (think Newt Gingrich when asked about his marriages). But the successful ones develop canned answers to roll out on cue without getting exercised. George W. Bush, for example, defused questions about his past drug and alcohol use with this classic line: "When I was young and irresponsible, I was young and irresponsible."

Truth Serum
Paul might consider paying some heed to the fact-checkers rather than dismissing them as ideological foes. For a presidential candidate, it can be dangerous and sometimes fatal to repeatedly mangle the facts or even to develop an image, justified or not, as untruthful. Just ask Al (Invented the Internet) Gore or Michele (Vaccine Causes Retardation) Bachmann.

At the same time, however, Paul is far from the only politician with complaints about fact-checkers, and the fairness of fact-checking a tweet or an opinion about presidential history is certainly debatable. Nor is Paul alone in his flights from reality. Nobody would win elections if the standard was 100 percent accuracy. Just to cite a few examples, since 2007 PolitiFact has rated 41 percent of Republican nominee Mitt Romney's statements false, mostly false, or "pants on fire." The group says 28 percent of Obama's statements fall into those categories, as do 32 percent of Vice President Joe Biden's. Obama just last month set off fact-checker alarms when he claimed that non-budget items had never been attached to a debt-ceiling hike.

Many of Paul's statements deemed distorted or false are not uniquely his. You hear some of them from other Republican politicians, and they are articles of faith among many in the grassroots. In one recent example, Paul was quick to jump on a headline making news in conservative media outlets, and spread it on Fox News. "Apparently the Amber Alert—you know searching for a kidnapped child—has been shut down, but the Let's Move weight-loss program for the first lady's open today. So I guess they do have priorities," he told Sean Hannity on October 7. But the truth is, state and local authorities are in charge of Amber Alert programs, and they were continuing to issue the alerts, including two in the three days before Paul's appearance. Only an informational federal website was shut down.

Another example is Paul's lead role in trying to end what he calls "special treatment" for federal employees who must switch to Obamacare and to require more of them to make the switch. In fact, the special treatment is in forcing them to give up the insurance they currently receive through their employer, the federal government (no one else in the country has to do that) and—part of Paul's proposal—in disallowing the feds to continue making an employer contribution to premiums (the equivalent of a huge pay cut, and not imposed on anyone else with employer-sponsored plans). This is a cause célèbre among conservatives and, along with other positions and statements judged wanting by fact-checkers, could actually help Paul in the 2016 primaries.

But that's not a sure thing, and a Democrat could capitalize plenty on this material in a general election. Which suggests Paul might well get further by telling the full truth to make many, perhaps all, of his limited-government, anti-entanglement, individual-responsibility points. He has already demonstrated that his ideas and style can win against a well-heeled opponent with more traditionally Republican views. Remember, Paul was almost a stealth candidate in 2010, a Tea Party upstart taking on Kentucky Secretary of State Trey Grayson in the GOP Senate primary. Grayson was the choice of Senate Minority Leader Mitch McConnell and the Kentucky party establishment. But the primary was a rout, symbolized by what happened in Grayson's home of Boone County, where Paul piled up 67 percent of the vote.

"Rand Paul did a very good job of getting out unique Republican primary voters that had never voted in a Republican primary before," says former Grayson strategist Marc Wilson, also of Boone County. "They were registered Republicans who were just kind of antiestablishment. They were part of what would be considered that hard-core tea-party, conservative, libertarian wing of the party, who really didn't get involved in Republican Party politics until they got excited about a candidate they all believed in."

Grayson, now head of Harvard's Institute of Politics and an expert on the pitfalls of underestimating Rand Paul, says he and his advisers knew Paul was no novice because they had videos of him stumping for his father in 2008. "We thought the videos were great because he said stuff voters wouldn't like," Grayson says of Rand Paul. Plus, "we just felt like he wouldn't be able to raise the money to be competitive." Wrong and wrong.

If he does pause and recalibrate his rhetoric, the younger Paul might be able to do what his dad could not: Translate energy and enthusiasm into votes that could win him the Republican nomination. Already he leads the theoretical 2016 field in some polls and sits in the top tier, along with Wisconsin Governor Scott Walker and New Jersey Governor Chris Christie, in the latest presidential ratings from the University of Virginia's Center for Politics. The center has said a Paul presidential campaign challenging his party's hawkish approach to foreign policy "could change the course of the GOP, just like Goldwater."

"Let's hope it's different than Goldwater's reset," Paul said wryly, "in the sense that we want to reset in a winning fashion."

Jill Lawrence is a national correspondent at National Journal. She was previously a columnist at Politics Daily, national political correspondent at USA Today and national political writer at the Associated Press.